|
4.Revenue
The Company’s net sales include retail stores and e-commerce merchandise sales as well as salon services and other revenue. Other revenue sources include the private label credit card and co-branded credit card programs, as well as deferred revenue related to the loyalty program and gift card breakage.
Disaggregated revenue
The following table sets forth the approximate percentage of net sales by primary category:
|
|
|
|
|
|
|
|
|
|
|
|
|
13 Weeks Ended |
|
|
26 Weeks Ended |
(Percentage of net sales) |
|
August 3, 2019 |
|
August 4, 2018 |
|
August 3, 2019 |
|
|
August 4, 2018 |
Cosmetics |
|
47% |
|
49% |
|
|
50% |
|
|
51% |
Skincare, Bath & Fragrance |
|
22% |
|
20% |
|
|
21% |
|
|
20% |
Haircare Products & Styling Tools |
|
21% |
|
21% |
|
|
19% |
|
|
19% |
Services |
|
6% |
|
6% |
|
|
6% |
|
|
6% |
Other (nail products, accessories, and other) |
|
4% |
|
4% |
|
|
4% |
|
|
4% |
|
|
100% |
|
100% |
|
|
100% |
|
|
100% |
Deferred revenue
Deferred revenue primarily represents contract liabilities for the Company’s obligation to transfer additional goods or services to a guest for which the Company has received consideration, such as unredeemed Ultamate Rewards loyalty points and unredeemed Ulta Beauty gift cards. In addition, the Company recognizes breakage on gift cards proportionately as redemption occurs.
The following table provides a summary of the changes included in deferred revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
13 Weeks Ended |
|
26 Weeks Ended |
|
August 3, 2019 |
|
August 4, 2018 |
|
August 3, 2019 |
|
August 4, 2018 |
Beginning balance |
$ |
173,921 |
|
$ |
130,591 |
|
$ |
193,585 |
|
$ |
110,103 |
Adoption of ASC 606 |
|
— |
|
|
— |
|
|
— |
|
|
38,773 |
Additions to contract liabilities (1) |
|
64,863 |
|
|
89,001 |
|
|
135,167 |
|
|
174,835 |
Deductions to contract liabilities (2) |
|
(66,831) |
|
|
(88,976) |
|
|
(156,799) |
|
|
(193,095) |
Ending balance |
$ |
171,953 |
|
$ |
130,616 |
|
$ |
171,953 |
|
$ |
130,616 |
| (1) |
Loyalty points and gift cards issued in the current period but not redeemed or expired. |
| (2) |
Revenue recognized in the current period related to the beginning liability. |
|